Question

9. The cash account for Santiago Co. on May 31 indicated a balance of $20,915. The Maybank statement indicated an ending balance of $25,645. Comparing the bank statement, the canceled checks, and the accompanying memos with the records revealed the following reconciling items: a. b. C. Checks outstanding totaled $5.975. (-) A deposit of $3,796 had been made too late to appear on the bank statement. +) A check for $1,482 returned with the statement had been incorrectly recorded by the company as $482. The check was originally issued to pay on account. The bank collected $4,515 on a note left for collection of which $515 was interest revenue Bank service charges for May amounted to $70. A check for $894 was returned by the bank because of insufficient funds. d. e. f. (a) Prepare a bank reconciliation as of May 31. b) Journaline the necessary entries. - If a balance sheet were prepared for Santiago Co. on May 31, what amount should be reported for cash? Santiago Co. Bank Reconciliation May 31

Answer 1

Requirement (a) Santiago Co. Bank Reconciliation May 31. Cash Balance According to Bank Statement Add : Deposits not Recorded by Bank $ 3,796.00 Less : Outstanding Checks $ (5,975.00) $ 25,645.00 $ (2,179.00) $ 23,466.00 Adjusted Balance $ 20,915.00 Cash Balance According to Company Records Add: proceeds of note collected by bank Less: Errors in Recording checks Less : Bank Service charges Less : Non Sufficient funds Check $ 4,515.00 $ (1,000.00) $ (70.00) $ (894.00) $ 2,551.00 23,466.00 Adjusted Balance Note : Since Only Requirement (a) is Asked Provided the Solution